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Bulls Drive Stocks out of Danger Zone, For Now

Wednesday March 9th will be a milestone for traders and investors alike. Stocks have more than doubled from their March 9,2008 credit crisis low of 666, otherwise known as the Devil's Low

And chatter on the Street this March 9th will have everything to do with the 2-year old bull and whether it grows much older.

A growing chorus of skeptics worry that the surging price of oil will be the proverbial thorn in this market’s side – with high prices at the pump wreaking havoc on the recovery not to mention the stock market.

However, calls for the bull's demise have been premature.

Even on Tuesday in the face of so much geo-political unrest the bulls were able to drive stocks out of the danger zone, at least from a technical perspective.

Specifically, the S&P 500 jumped back above a six-month trend line that connects lows in late August and late November, after closing just below it on Monday. Similarly, the Nasdaq rallied from its 50-day moving average in another indication of an uptrend.

Holding these levels are considered signs of strength, but traders remain cautious, worried that these key technical levels will soon be tested again.

What should you be watching?

Instant Insights with the Fast Money traders

Fast trader Joe Terranova suggests keeping an eye on the 50-day in the S&P, which is about 1294. He thinks as long as that level holds, the rally remains in tact.

As for key technicals being tested again, Terranova will be watching. “If we get another leg up in oil, if it runs toward $110 as long as the S&P holds above its 50-day moving average, I’d take it as a sign that fundamentals are strong,” he says.

In fact, Terranova believes fundamentals will drive the market going forward. He thinks as the market grows more comfortable with higher oil prices, signs of economic improvement will be the major market catalyst.

Oppenheimer’s Carter Worth is also bullish. By year’s end he thinks the S&P trades much higher. “1400 is our objective for this year,” he says.

If you’re an investor who believes the market’s fortunes are tethered to the price action in oil, Rich Ilczyszyn, Lind-Waldock Senior Market Strategist has some good news. He also expects the market to become more comfortable with $100 oil.

He says if Gaddafi leaves Libya and nothing big happens on Friday during the Day of Rage in Saudi Arabia, “we could see a little pullback.” He wouldn’t be surprised to see oil trade down to $95.

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THE TRADES: ENERGY

If you’re looking for an energy trade Tim Seymour is bearish on Exxon . “The charts of Exxon looked tired,” he says.

Karen Finerman has Canadian Oil Sands on her radar, but says don’t jump in yet. “I think there’s a little more froth to come out of the space, yet.”

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THE TRADES: TECH

Looking at the action in the Nasdaq, Guy Adami thinks it’s a mistake to lump all technology together. “IBM and Oracle are names that work,” he says. “On the up days you see the cream rises to the top.”

In this space, Joe Terranova is a buyer of Oracle, IBM and Juniper .

"I find Hewlett-Packard so compellingly cheap I continue to stay involved," says Karen Finerman. It hasn't worked out yet, but I think it does work out.

Tim Seymour has Nokia on the radar. "The reality is this is an R&D fat company and they're going to slice off a lot of that now," he says.

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THE TRADES: FINANCIALS

Meanwhile, Karen Finerman suggests keeping an eye on financials . As you may know, Bank Of America led the financials higher on Tuesday after CEO Brian Moynihan told the crowd at its investor day that the bank's earnings power is back and a dividend is coming soon. Finerman is bullish BofA.

In this space, Guy Adami has both Regions and USB on his radar.





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Trader disclosure: On March 8, 2011, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s "Fast Money" were owned by the "Fast Money" traders; Seymour owns (AAPL); Seymour owns (BAC); Seymour owns (F); Seymour owns (GE); Seymour's firm is short (FCX); Seymour's firm is short (POT); Seymour owns (IIF); Adami Owns (AGU); Adami Owns (C); Adami Owns (GS); Adami Owns (INTC); Adami Owns (MSFT); Adami Owns (NUE); Adami Owns (BTU); Adami's wife works for (MRK); Finerman's Firm Is Short (IWM); Finerman's Firm Is Short (SPY); Finerman's Firm Is Short (MDY); Finerman's Firm is short (XRT); Finerman's Firm is short (IJR); Finerman's Firm Is Long S&P Puts; Finerman's Firm Is Long Russell 2000 Puts; Finerman's Firm And Finerman Own (AAPL); Finerman's Firm Owns (BAC) Leap, Finerman Owns (BAC); Finerman's Firm Owns (BBY); Finerman's Firm And Finerman Own (BP); Finerman owns (C); Finerman's firm owns (FDO); Finerman owns (GM) leaps; Finerman Owns (GOOG); Finerman's Firm And Finerman Own (HPQ); Finerman's Firm Owns (IBM); Finerman's Firm Owns (JPM), (JPM) Leap; Finerman Owns (JPM); Finerman's firm owns (M); Finerman's Firm And Finerman Own (MSFT); Finerman's firm owns (TGT); Finerman's Firm Owns (WMT); Terranova owns (VRTS); Terranova owns (C); Terranova owns (UPL); Terranova owns (ABT); Terranova owns (MS); Terranova owns (PBR); Terranova owns (BAX); Terranova owns (TEVA); Terranova owns (CVI); Terranova owns (RSX); Terranova owns (SU); Terranova owns (CNQ); Terranova owns (JPM); Terranova owns (PNC); Terranova owns (GS); Terranova owns (USB)

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